Phila. Lines Up Outside Groups To Run Schools

With one of urban education's heavy hitters at the helm, the
Philadelphia school district is getting down to the nuts and bolts of
the biggest school privatization experiment in the country. But with
only a month to go before schools open, the path to improvement is
anything but smooth.

Paul G. Vallas, the straight-talking budget whiz who ran Chicago's
schools for six years, took over as the Philadelphia schools' chief
executive officer on July 17. He made good on his vow to "get in the
middle of everything," meeting with parents and visiting classrooms
even before his suitcases were unpacked.

Mr. Vallas assembled a transition team to help him evaluate the
district's $1.7 billion budget and draft educational and financial
plans. He said he intends a "radical reprioritization" in district
finances, shifting money from administration to programs he believes
raise student performance, such as summer school, universal preschool,
and an extended school day.

Steering the Chicago district's restructuring from 1995 to 2001 has
made Mr. Vallas no stranger to conflict and controversy. He found
plenty of both the minute he arrived in Philadelphia: State and city
leaders were bickering over how to distribute the state money pivotal
to the overhaul of the 200,000-student district. And none of the seven
outside managers set to take over 45 schools had a signed contract.

Five-year contracts totaling $120 million were not final until July
31, only five weeks before school starts on Sept. 5. The outside
groups, which had hoped for signed contracts last spring, scurried to
ready their schools for opening.

Mr. Vallas reacted to the tumult with determination and humor.
Quoting an actor in the film "Apollo 13," the movie buff said simply:
"Failure is not an option."

'Stakes Are High'

Finances and test scores in the nation's eighth-largest school
system are so battered that the state of Pennsylvania took the district
over last December, replacing its school board with a five-member
School Reform Commission appointed by the city and the state. The
improvement plan has sparked both support and intense opposition
because of the unusually large role given to private school managers.
("Groups Named to Lead
Dozens of Ailing Phila. Schools," April 24, 2002.) The plan calls
for the 264-school district to hand over 45 of its lowest-performing
schools to outside firms or managers, the largest-scale such
undertaking ever attempted. Another 25 struggling schools will be
converted to charters or reconstituted and run by the district. Another
16 that are lagging but making progress will receive additional
financial help.

Three for-profit companies will be paid a total of $18 million this
coming school year to run 30 Philadelphia schools. Edison Schools Inc.,
the nation's largest private operator of public schools, gets the
lion's share: $11.8 million for managing 20 schools. Victory
Schools—based, like Edison, in New York City—and Chancellor
Beacon Academies, based in Miami, will each operate five.

Fifteen schools will be managed by four nonprofit groups or
institutions: Temple University; the University of Pennsylvania;
Universal Companies, a local neighborhood-redevelopment group; and
Foundations Inc., a Mount Laurel, N.J.-based provider of after-school
programs. They will be paid a total of $3.7 million this year.

As the dysfunction of many urban schools rises higher on the
nation's radar, experts across the country are watching with
interest—and, in many cases, skepticism—as yet another big
American city mounts a major effort to improve its schools.

"This is the most exciting thing going in education since Chicago,"
the scene of an ambitious reform drive in the mid-1990s, said Wilbur C.
Rich, who focuses on education governance as a political science
professor at Wellesley College in Wellesley, Mass.

"Everyone agrees that urban education is not working, and we're
trying a variety of things to see what works," Mr. Rich said. "So the
stakes are very high in Philadelphia. How are they going to implement
this stuff? What looks good on paper might not work in reality."

To ensure improvement at the 70 targeted schools, and to finance
other district-wide endeavors such as new textbooks and teacher
training, the city of Philadelphia committed $45 million in new money
to the schools. The state approved $83 million, despite the grumbling
of many lawmakers who view the district as a money pit and whose own
home-district school funding was flat-lined in a tight budget
year.

Strings Attached

But as the city soon learned, state Secretary of Education Charles
B. Zogby had tied a big string to the money: The schools managed by
outside groups must get first crack at $55 million of it. In a scathing
July 18 letter to the chairman of the school reform commission, Mr.
Zogby insisted that those schools receive a higher funding level to
ensure real improvement.

That condition prompted cries of cronyism, since Edison has long-
standing ties to the Republican Pennsylvania governor's office.

"Even if there hasn't been any impropriety, it sure looks that way
on the surface," said George P. White, a professor of educational
leadership at Lehigh University in Bethlehem, Pa.

Edison officials dismissed allegations of unfair play. The
undisclosed amount of money offered by the school reform commission was
insufficient to fully implement Edison's program, so company officials
let state leaders know how much money they needed, said company
spokesman Adam Tucker.

When the dust cleared, a compromise emerged. Edison and most of the
other private providers will get higher per-pupil funding than other
schools, but they will not get all of the $55 million. They will share
it with a list of low-performing schools that expanded from 70 to 86.
The rest of the $83 million in state aid, combined with district money,
will finance districtwide improvements, such as summer school and
literacy programs.

Edison, which has endured steady and vocal opposition from
Philadelphians opposed to the private management of public schools, has
watched its stock value fall as its role in the city of Brotherly Love
has dwindled.

Last winter, Gov. Mark S. Schweiker proposed that Edison operate the
entire district, but opposition snuffed out that plan. The company then
hoped to run 45 schools and land a six-year, $101 million contract to
act as a management consultant.

By the spring, the school reform commission offered Edison the
chance to serve as a consultant and to run 20 schools. Dollar figures
on those two proposals were not publicly revealed, but sources told
Education Week that Edison wanted $18 million to $24 million for
the consulting contract.

But after Mr. Vallas arrived in Philadelphia, he put the kibosh on
the consulting arrangement.

"We don't need a 'lead education consultant,'" said Mr. Vallas, who
is earning $225,000 a year as CEO. "That's what I'm here
for."

Teacher Vacancies

As education leaders in the district wrestled over how to implement
the massive restructuring, community members, teachers, and parents
were trying to adapt to the changes, with a mix of optimism, doubt, and
anger.

Officials of the Philadelphia Federation of Teachers, which
represents the city's 13,000 teachers, expressed worries that the 70
target schools will not be properly staffed when school opens. They
noted that of the approximately 275 current teacher vacancies in the
district, more than half were in those schools.

But the outside providers said they were confident they would have
the openings filled by the first day of school.

The union, an American Federation of Teachers affiliate that has
opposed private management of the schools, was also concerned that
teachers at the 45 schools to be run by Edison and other providers had
too little information about their assignments and curricula to operate
effectively.

"Many teachers still don't know what the program is," said PFT
spokeswoman Barbara Goodman. "There is the potential for utter chaos
when school opens."

Judy Sweeney doesn't expect chaos, but she confesses to some
anxiety. She teaches at one of the schools Edison will run, Penn-Treaty
Middle School, which serves 800 predominantly Hispanic children from
low-income families in the city's Kensington neighborhood.

Edison's approach "sounds good," she said, and most teachers in the
building have attended Edison training, but she and other teachers
still are uncertain what their duties will be.

"We met with the principal, and we had some questions he couldn't
answer," said Ms. Sweeney. "One algebra teacher wanted to know if she
would still be teaching that. We wanted to know if there was going to
be an extended day. We just don't have answers yet."

At another Edison school, Gillespie Middle School in North
Philadelphia, the early signs of Edison's management are receiving high
marks from Principal Romesa Scott. A tractor-trailer pulled up last
month and unloaded new books, science equipment, and other supplies in
a "precision operation," she said. Leaders of the 700-student school
were flown to Atlanta in mid-July for training.

"Edison's program proposes to attack the very issues we have
identified at the school," Ms. Scott said, such as stronger discipline
and better parent outreach. "What this will take is a real concentrated
effort to do things differently," she said. "The people I have been
interacting with believe it can happen, but it's going to be
difficult."

Some city residents complain that the outside groups have not
reached out adequately to involve community groups or inform parents.
The state takeover plan envisioned that each school under outside
management would "partner" with a community organization; the role was
seen as pivotal enough that the 70 schools on the list were referred to
as "partnership schools."

A number of groups sought permission from the reform commission to
play that role, but as of the last week of July, no groups had been
chosen as partners.

Some parents reported feeling out of the loop. Benita Clark, who
lives in southwestern Philadelphia, said a nephew who lives with her is
slated to attend a middle school being taken over by Edison, but she
has heard nothing from the company and doesn't know what to expect.

Mr. Tucker, the Edison spokesman, said the company sent several
letters home with students last spring describing the company's plans
and providing the company's Web address and toll- free telephone
number.

"They promised a partnership that would gather parents so we are
informed and active," said Ms. Clark, who also has a daughter in high
school. "But my neighbors and myself, no one's been contacted. Parents
don't know what's going on. We're concerned."

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